Published Tue, 11 Jun 2019 08:15:00 -0400 on Seeking Alpha
Co-produced with Treading Softly and PendragonY for High Dividend Opportunities
Recently we've released a series of articles focusing on the CLO sector. This sector is filled with myths, falsehoods and a general lack of understanding by retail investors and many market analysts. We've actively debunked these myths and put forward various securities that provide exposure to this sector. Today we're pleased to provide a general sector update as we continue our coverage.
Common Questions About CLOs
We've answered these questions many times in various articles but I wanted to put some of them here, right at the top so new readers can have them nailed down before we delve farther.
"Didn't they cause the Great Financial Crisis?!"
No. In our original article we tackled this misconception, but it continues to be repeated by readers and SA contributors who lack a complete understanding of CLOs. As before we noted that Voya expressed the success of CLOs in the financial crisis as follows:
CLO debt and CLO equity were tested through a market cycle that included the biggest financial crisis since the Great Depression. Investors who held their CLO investments through the 2008–2010 period were rewarded with strong IRRs... equity tranches returned a median IRR in the mid-teens, B-rated tranches returned a median IRR in excess of 10%, and BB-rated tranches returned 6%–10% depending on the vintage.
We'll remind that this means that CLO equity tranches out performed vs.... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|OXFORD LANE CAPITAL||10.46||0.0||0.00||1.62||15.47|
|EAGLE POINT CREDIT||17.90||0.0||-0.75||2.40||13.54|
|ANNALY CAPITAL MANAGEMENT||9.21||0.0||-1.59||1.20||13.16|
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